ITV

Tag: GST Council

  • Industry bodies raises concern over revised GST rates in online gaming

    Industry bodies raises concern over revised GST rates in online gaming

    Mumbai: The three largest online skill gaming associations in the country, E-Gaming Federation (EGF), All India Gaming Federation (AIGF) and Federation of Indian Fantasy Sports (FIFS), expressed concern at the recent media reports, which suggest that the GST rate on online skill games may be increased from existing 18 per cent to 28 per cent.

    In an official statement released, the three industry bodies said that what is more worrying is some media reports suggesting that the tax may be levied on total pool (prize money pooled plus the platform commission) and not on gross gaming revenue (GGR). The latter, if implemented, they said, will mean the demise of the online skill gaming industry in India.

    EGF CEO Sameer Barde said, “Such a step is not only in dissonance with international best practices but is also violative of the principles of GST. Essentially, the online skill gaming operators are platforms, which bring players from various geographies together. The money pooled is eventually distributed to the winning player. The platform charges a predetermined fee, known as GGR, and pays tax on that. If you were to charge an increased tax rate on the entire quantum (pooled money plus commission), it is not only principally incorrect but will also annihilate this sunrise sector.”

    Highlighting that the sector has immense economic benefits, the industry associations appealed to the GST Council to understand the salience of games of skill and take a decision considering international taxation best practices.

    “Global studies have shown that incidence of taxation, on prize money instead of gaming revenue, leads to reduced tax collections for the exchequer and ends up giving a fillip to the black-market operators at the expense of legitimate tax paying players,” said FIFS CEO Anwar Shirpurwala. He further added that any regulations or taxation related to skill gaming should not be treated at par with games of chance, as these are very divergent activities both in terms of law and in practice.

    With a combined membership of around 100 operators, between them, EGF, AIGF and FIFS, represent more than 90 per cent of the online skill gaming market in India. In the last few years, the online skill gaming sector has emerged as a growth engine for the Indian economy with direct benefits to a lot of sectors such as fintech, sports, animation & graphics, semiconductor, edtech and software development. The sector has also witnessed investments from marquee global venture capital and private equity firms. In the last six years, the online skill gaming sector has received foreign investment of over two billion dollars. The sector already employs around 50,000 people.

    AIGF CEO Roland Landers said, “At one level the sector is very upbeat at the prospect of contributing towards growth of the Indian economy. We are very encouraged by the encouragement shown by the government, through formation of AVGC task force, constitution of inter-ministerial task force and the recent initiatives by MeITY to engage with the industry. But all this will amount to nothing, if it is not supported by a progressive taxation regime. An increased tax rate, and then levying the tax on the entire contest entry amount (instead of GGR), will be catastrophic for the industry, even nipping its potential in the bud.”

  • GST Constitutional Amendment Bill gets Lok Sabha nod after amendments

    GST Constitutional Amendment Bill gets Lok Sabha nod after amendments

    NEW DELHI: The long-awaited Goods and Services Tax Bill (GST), which has been riddled by several controversies which began in the time of the UPA government, has finally been passed with amendments worked out to pacify a vociferous opposition which held the majority in the Rajya Sabha.

    Although the Bill had been passed earlier in the Lok Sabha, an adamant Congress insisted on some changes which were worked out after talking to all states and the opposition parties.

    Thereafter, the amended bill had been introduced in the Rajya Sabha and passed last week. However, in view of the amendments, the amended Bill had to go through the entire rigmarole of a discussion in the Lok Sabha before it was passed unanimously.

    As the GST Bill is in the form of a Constitution Amendment, the rules required that it had to be passed by two-thirds of the members present and voting.

    The Amendment Bill will now go for Presidential assent to Pranab Mukherjee, but can become law only after it is ratified by at least fifteen state governments. The government hopes to get the approval within 30 days as it has set a deadline of 1 April 2017 for implementation of GST. Several states will have to call for special sessions to clear GST in the next 30 days.

    The Bill, which Finance Minister Arun Jaitley describes as a “one nation one tax” bill, was described by Prime Minister Narendra Modi as a major step “that will deliver us from tax terrorism.” He said “GST means a Great Step Taken by India, a Great Step of Transformation, Great Step towards Transparency.”

    Jaitley said India’s biggest tax reform will see the centre and states “pooling their sovereignty to reap the many benefits that will ultimately lead to India’s progress”. He claimed that “Tax evasion will lessen, there will be no tax on tax or a cascade of taxes and ease of doing business will improve.”

    The Rajya Sabha, where the government is in a minority, had passed the bill unanimously last week, with 203 members supporting and none against.

    Interestingly, the Congress reminded the government today that it had got the Bill passed in the Lok Sabha last year by the sheer dint of its numerical strength and not consensus.

    A GST council will be formed after that with states and the centre as members. This council will recommend rates and other modalities for GST, which will replace a raft of different state and local taxes with a single unified value added tax system turning India into world’s biggest single market.

    Parliament will need to clear two more GST-related bills and each state will have to pass its own law. The government will push to get this done in the winter session of Parliament to meet the deadline.

    FICCI President Harvardhan Neotia said: “The approval of the Constitutional Amendment Bill marks crossing of another milestone in the journey towards introduction of a Goods and Services Tax (GST) regime in the country. The industry eagerly looks forward to the implementation of this uniform and simplified tax regime. It is expected that GST will lead to easy tax compliance and improve India’s competitiveness in the global arena. Implementation of GST will be a big incentive for bringing new investments into India and eventually will foster the growth of the Indian economy. FICCI would be privileged to work with and support the Central and State Governments in enabling a timely and hassle-free roll out of GST in India”

  • GST Constitutional Amendment Bill gets Lok Sabha nod after amendments

    GST Constitutional Amendment Bill gets Lok Sabha nod after amendments

    NEW DELHI: The long-awaited Goods and Services Tax Bill (GST), which has been riddled by several controversies which began in the time of the UPA government, has finally been passed with amendments worked out to pacify a vociferous opposition which held the majority in the Rajya Sabha.

    Although the Bill had been passed earlier in the Lok Sabha, an adamant Congress insisted on some changes which were worked out after talking to all states and the opposition parties.

    Thereafter, the amended bill had been introduced in the Rajya Sabha and passed last week. However, in view of the amendments, the amended Bill had to go through the entire rigmarole of a discussion in the Lok Sabha before it was passed unanimously.

    As the GST Bill is in the form of a Constitution Amendment, the rules required that it had to be passed by two-thirds of the members present and voting.

    The Amendment Bill will now go for Presidential assent to Pranab Mukherjee, but can become law only after it is ratified by at least fifteen state governments. The government hopes to get the approval within 30 days as it has set a deadline of 1 April 2017 for implementation of GST. Several states will have to call for special sessions to clear GST in the next 30 days.

    The Bill, which Finance Minister Arun Jaitley describes as a “one nation one tax” bill, was described by Prime Minister Narendra Modi as a major step “that will deliver us from tax terrorism.” He said “GST means a Great Step Taken by India, a Great Step of Transformation, Great Step towards Transparency.”

    Jaitley said India’s biggest tax reform will see the centre and states “pooling their sovereignty to reap the many benefits that will ultimately lead to India’s progress”. He claimed that “Tax evasion will lessen, there will be no tax on tax or a cascade of taxes and ease of doing business will improve.”

    The Rajya Sabha, where the government is in a minority, had passed the bill unanimously last week, with 203 members supporting and none against.

    Interestingly, the Congress reminded the government today that it had got the Bill passed in the Lok Sabha last year by the sheer dint of its numerical strength and not consensus.

    A GST council will be formed after that with states and the centre as members. This council will recommend rates and other modalities for GST, which will replace a raft of different state and local taxes with a single unified value added tax system turning India into world’s biggest single market.

    Parliament will need to clear two more GST-related bills and each state will have to pass its own law. The government will push to get this done in the winter session of Parliament to meet the deadline.

    FICCI President Harvardhan Neotia said: “The approval of the Constitutional Amendment Bill marks crossing of another milestone in the journey towards introduction of a Goods and Services Tax (GST) regime in the country. The industry eagerly looks forward to the implementation of this uniform and simplified tax regime. It is expected that GST will lead to easy tax compliance and improve India’s competitiveness in the global arena. Implementation of GST will be a big incentive for bringing new investments into India and eventually will foster the growth of the Indian economy. FICCI would be privileged to work with and support the Central and State Governments in enabling a timely and hassle-free roll out of GST in India”